EU formally approves €90bn Ukraine loan and 20th sanctions package against Russia

 

EU formally approves €90bn Ukraine loan and 20th sanctions package against Russia

 

Ursula von der Leyen hails ‘good news’ after Hungary’s lifting of vetoes allows leaders to sign off on agreements

 

Jennifer Rankin in Brussels

Thu 23 Apr 2026 19.02 BST

https://www.theguardian.com/world/2026/apr/23/eu-approves-ukraine-loan-sanctions-russia

 

EU leaders have welcomed the end of diplomatic deadlock over a long-awaited €90bn (£78bn) loan for Ukraine, after the bloc completed the agreement along with a 20th sanctions package against Russia.

 

After weeks of delay, the EU signed off on the loan on Thursday, in time for a summit in Cyprus that began in the evening and will include talks over a dinner with the Ukrainian leader, Volodymyr Zelenskyy.

 

Ursula von der Leyen wrote on social media: “We are on our way to Cyprus with good news.” The European Commission president welcomed both agreements, finalised after Hungary lifted its veto.

 

Von der Leyen said: “While Russia doubles down on its aggression, we are doubling down on our support to the brave Ukrainian nation, enabling Ukraine to defend itself and putting pressure on Russia’s war economy.”

 

Speaking later, von der Leyen said she thought it would be possible to disburse the first tranche of the €45bn funding planned for 2026 in this quarter, meaning by the end of June. The first payment, she indicated, would fund Ukraine’s domestic drone production – “drones from Ukraine for Ukraine”.

 

The loan, funded by EU borrowing with the intention that Russian reparations will fund repayments, is expected to provide two-thirds of Ukraine’s financial needs in 2026 and 2027.

 

The latest EU sanctions against Russia – the 20th round since the invasion – blacklist Russian banks and energy companies, as well as entities in the United Arab Emirates, Thailand and China, including Hong Kong, for helping Moscow evade western restrictions.

 

In the first case of its kind, the EU is also imposing a ban on the export of hi-tech machine tools and telecoms equipment to Kyrgyzstan, which is accused of “systematic and persistent” failure to prevent their re-export to Russia, where they are used to make missiles and drones. The former Soviet Republic has previously said it is working to comply with western sanctions.

 

Hungary lifted its vetoes over the long-delayed loan and sanctions after a dispute over a damaged oil pipeline that traverses Ukraine came to an end. Russian oil deliveries to Hungary and Slovakia resumed on Thursday, the Hungarian energy group MOL reported, after both countries – heavily dependent on Russian crude – dropped their objections to EU support for Ukraine.

 

Viktor Orbán, the Hungarian prime minister who was defeated by his Conservative rival, Péter Magyar, earlier this month, will not take part in what would have been his final EU summit.

 

Zelenskyy joined the other leaders in the Cypriot resort of Ayia Napa for talks over dinner. “It matters that Ukraine is securing this level of financial certainty,” he wrote on social media highlighting spending priorities that included arms production, “the procurement of necessary weapons from partners that do not yet produce in Ukraine”, and preparing the energy sector for next winter – a response to Russia’s devastating attacks on Ukraine’s energy infrastructure in recent months.

 

He told reporters that he wished the incoming Hungarian government all the best, while questioning Orbán’s approach to Ukraine. “Our people need to have strong, warm, good relations,” he said referring to the two countries. “You are neighbours. You have to live in peace.” His team was already in touch with its Hungarian counterparts, he added.

 

Welcoming the agreements, the European Council’s president, António Costa, said “the next step is to open the first cluster of negotiations for the Ukrainian accession to the European Union”.

 

Hungary has also been blocking the opening of “clusters” of negotiating topics that will allow Ukraine to make progress on its application to join the EU. While other member states support the start of talks, many are also wary of any fast-track procedure for Kyiv, which filed its application for EU membership a few days after the full-scale Russian invasion.

 

EU leaders will also discuss how to respond to surging energy prices and the wider ramifications of war in the Middle East, amid uncertainty over a definitive end to the conflict.

 

Regional leaders including the Lebanese president, Joseph Aoun; the Egyptian president, Abdel Fatah al-Sisi; the Syrian president, Ahmed al-Sharaa; and the Jordanian crown prince, Hussein bin Abdullah, are expected to take part in discussions on Friday.

 

Speaking earlier this week, before Donald Trump announced an indefinite extension of the ceasefire with Iran, an EU official said the discussion was dependent on “very volatile and fast-paced events” in the Middle East, adding “we certainly hope the ceasefire is kept and maintained”.

 

EU leaders are also expected to discuss ideas to respond to a rise in energy prices, including a proposed cut to electricity taxes and incentives to accelerate the shift to green energy. Despite a boost to wind and solar power since the energy crisis of 2022, the EU has been slower to scale down the use of oil and gas in other parts of the economy, such as transport and housing.

 

The European Commission warned on Wednesday of the EU’s “dangerous dependency on fossil fuels” as it said that the bloc had paid an additional €24bn in oil and gas imports since the outbreak of the Middle East conflict in February.

 

Meanwhile, the president of Cyprus, Nikos Christodoulides, has called for a discussion on how to “give substance” to the EU’s mutual assistance clause. Article 42.7 of the EU treaty obliges member states to provide “aid and assistance by all the means in their power” to a fellow member that is a victim of armed aggression on its territory.

 

Cyprus, which is not a member of Nato, wants the EU to take that clause more seriously, after a drone hit a British base on the island in March. The clause has only been activated once, by France after the Paris terrorist attacks of 2015, but many officials are unsure how it works in practice.

 

Other member states want to ensure talks about the pact do not undermine Nato’s mutual defence clause, article 5, at a time when Trump complains frequently about the value of the transatlantic alliance. Gitanas Nausėda, president of Lithuania, a Nato member, said: “For me it is an absolutely crucial thing that article 5 is absolutely key to our defence and security and it will remain so.”